Green Room

Kathleen Sebelius doesn’t know what premium support is–and she should

That is, if she wants to be critical of Paul Ryan’s plan. HHS Secretary Kathleen Sebelius was quick to say that seniors would “die sooner” under the Ryan Medicare plan, but did she even read it and furthermore does she even understand it? One would think that she would understand “premium support” as she’s a former insurance commissioner. Kaiser Health News reviews premium support and its history (emphasis mine):

Under a premium support system, the government would pay a percentage toward the insurance premium for each individual; there would likely be more help for low-income and sicker people. And enrollees could (not required) kick in more money to get better coverage.

Henry Aaron, senior fellow at the Brookings Institution, and Robert Reischauer, president of the Urban Institute and former head of the Congressional Budget Office, in 1995 were among the first to explore alternatives to Medicare’s system of paying for individual services. And in 1998, President Bill Clinton’s National Bipartisan Commission on the Future of Medicare, chaired by then-Rep. Bill Thomas, R-Calif., and then-Sen. John B. Breaux, D-La., developed a “premium support” idea, but it never became a formal recommendation. Breaux and then-Sen. Bill Frist, R-Tenn., tried unsuccessfully to advance the plan as separate legislation.

Let’s take a look at her ‘confuzzled’ look as she was clearly caught off-guard by Congressman Michael Burgess (R-TX and a physician) as seen here at the July 13 subcommittee hearings (skip to .59 to 2:16):

This, of course, is as ludicrous as it is uncouth. First, the Ryan plan (which wouldn’t affect anyone who is not yet 55 years old) would not give seniors a voucher, as Sebelius well knows. Instead, the government would provide premium support to help seniors purchase private health insurance. Seniors would pick the insurance plan of their choice, and the government would funnel the premium support directly to the insurer — just as it does for Medicare Advantage, the Medicare prescription drug benefit, and the health care system for members of Congress.

The Ryan plan would require insurers to cover any and all seniors as the condition of their being allowed to compete for seniors’ business. It would provide higher levels of premium support for less healthy and less wealthy seniors, and poor seniors would have every dollar of their care provided at taxpayer expense. The premium support would start at the average level of funding for traditional Medicare ($15,000 a year) and would rise with inflation from there.

In truth, seniors would likely have better catastrophic coverage under Ryan’s plan than under traditional Medicare. There’s a reason why the vast majority of Medicare beneficiaries buy private Medigap coverage: There’s a whole lot of care that Medicare currently doesn’t cover. Despite that fact, Medicare is going bankrupt, and it desperately needs an infusion of private competition and choice to make it more efficient, cost effective, and affordable.

In short, seniors wouldn’t “die sooner” under Ryan’s plan. But Medicare would die sooner without it.

This is just more proof that Sebelius is nothing more than a partisan mouthpiece. Her ideology gives away her game with her wanting to insert government into the playing field, and further evidenced the day before by none other than Paul Ryan who grills Sebelius on whether seniors should have control of their own health care and choices for their drug coverage. Sebelius stumbles at the basic principle of allowing seniors to choose their own plan, but knows that choice is good for competition, and would gladly put the government at the top of that competitive scale. Watch to the end.